The sale of Roxi Petroleum’s equity and debt interests in the Galaz area located in central Kazakhstan to Xinjiang Zhundong Petroleum Technology Co. will be completed by the end of May.
Disposal will now be US$100 million and the net proceeds attributable to Roxi will be approximately $23 million.
A total of $2 million of the aggregate purchase will be retained by the purchaser for a period of 12 months to cover warranty claims individually greater than $50,000. Roxi's share of this retention will be $0.68 million.
The central Asian oil and gas company focused on Kazakhstan noted in a statement that it plans to use the proceeds of the Galaz disposal to fund all of the planned development in 2015 at its flagship asset BNG in the west of Kazakhstan.
The expected profit after tax on the sale of Galaz is approximately $17 million.
“The funds, once released from the sale of Galaz, will cover our BNG work programme for 2015, which we hope will lead to an appreciation in the value of the group without dilution for Roxi shareholders,” said Clive Carver, chairman, Roxi.
Located in the Turgai basin in Central Kazakhstan, the Galaz block is 179sq km. About 30sq km of 3D seismic has been acquired and processed.
The block includes significant exploration upside on the east side of the Karatau fault system, as well as the NW Konys development. So far 17 wells have been drilled and recent production has been at the rate of approximately 770 b/d of oil.
Roxi has an effective 34.22 % interest in Galaz, which runs on an exploration basis until 14 May 2016. The other principal shareholders in Galaz are Korea’s LGI (40%), as operator and Baverstock, (23.78%).
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